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Thursday, January 30, 2014

Insurers consider suicides as natural deaths

In order to smooth
processing of claim settlements, life insurance companies in India consider
suicides at par with natural deaths and not as accidental deaths.

As per senior officials from the industry, for a smooth claim settlement it has
to be proved that the life insured has committed suicide. It is because there
is a conception that most suicides are not pre-meditated.

Although, during the settlement of claims where the insured dies because of
suicide, the insurers look at how old the policy is. Because in suicidal case,
the insurers have a waiting period of one year; and only after the period they
settle claims. It means if an insured commits suicide within one year of buying a life insurance policy, and it is proved that the insured had indeed committed
suicide, the nominee in the insurance policy will not be able to get any amount
from the insurer.

Further, the officials said that some life insurance products come with double
accident claim benefits. In case of a suicide, the nominee in the policy cannot
claim the extra sum assured for accidental deaths. In cases where the death is
not due to natural causes and also it is not proven to be suicide, it is
accepted as an unnatural death and extra claims for accidental deaths usually
paid.